Big Liberal donors are doing big business with the B.C. government

British Columbia Premier Christy Clark, left, and Telus Corp. President and CEO Darren Entwistle share a laugh before he announced a $1-billion investment to connect the majority of homes and businesses in Vancouver directly to a gigabit fibre optic network, during a company event in 2015.DARRYL DYCK / THE CANADIAN PRESS

Doing business with the B.C. government and at the same time donating money to political parties — those in power or those who hope to govern — is entirely legal in British Columbia.

In the United States, since 1939, it has been illegal for individuals and corporations that have federal contracts, or are negotiating them, to give money to federal candidates, parties or committees. That law was upheld in a 2015 federal court ruling.

Some states have similar laws, including New Jersey, South Carolina and West Virginia.

At the national level in Canada and in many provinces, including Quebec and Manitoba, and most recently Ontario and Alberta, companies doing business with the government are not allowed to make political contributions because corporation and union donations are banned.

The lack of any such rule in B.C. makes it an outlier in Canada, and could prove to be an issue for voters after the B.C. Liberals raised $14 million in 2016 and 2017 in the run-up to the May 9 provincial election.

Nola Western, B.C.’s deputy chief electoral officer, said the Elections Act only bans donations from unregistered political parties and constituency associations in B.C., political parties and constituency associations at the federal level, and from charities.

“Anybody else can give,” said Western.

Telus, the Canadian telecommunications giant, is among the top B.C. Liberal donors in the past decade. It has given $565,000 between 2005 and 2016, according to a list compiled by Postmedia from B.C. Elections figures.

Telus is also a major contractor with the B.C. government. It had more than $730 million in business with the B.C. government, according to an examination by Postmedia of supplier payments from 2007 to 2016 listed in B.C.’s public accounts.

Telus is not alone.

Among the top 50 donors to the B.C. Liberals — who have collectively given more than $30 million in the past decade — more than half have received supplier payments or transfers from the B.C. government.

The payments and transfers totalled $885 million between 2007 and 2016, according to the Postmedia analysis of B.C. public accounts figures.

While there is no evidence that contracts were awarded improperly, it is clear the top donors to the B.C. Liberals are doing business at a larger scale than others who give less.

In a sample of 50 other donors, taken in the mid-range of B.C. Liberal donors, those who had given $5,000 between 2015 and 2016, only two companies were doing business with the province with payments totalling $26.7 million.

There are also major government contractors who give little to the B.C. Liberals. For example, HP (Hewlett Packard) Advanced Solutions had $888.6 million in contracts with the province in the past decade, and made donations to the Liberal party of $4,000. They also gave $2,500 to the NDP.

But Hewlett Packard does have a significant lobbying effort in Victoria, and several of its lobbyists have contributed more than $125,000 to the Liberals.

Companies who do business with the province also gave to the NDP in the run-up to the 2013 election, which the New Democrats were widely expected to win.

York University political scientist Robert MacDermid said most people would see some sort of conflict when people who do business with the government also give money to the governing party.

He is familiar with the rules in the United States, including the federal laws introduced in 1939, but said it is simpler to deal with the issue of donors doing business with the government by banning corporate and union donations.

“Even if (a conflict) doesn’t exist, there’s going to be the perception of undue influence,” said MacDermid, who helped write a 2016 report on the influence of donations at the municipal level in Ontario.

“Governments have faced this in every jurisdiction across Canada, and usually they come to their senses and actually decide that it doesn’t look good and they ban it.”

University of Lethbridge political sociologist Trevor Harrison said there are potential issues for both donors and the government when companies are making political contributions. “Governments can shake down donors, but also the donors do expect something back,” said Harrison.

Other top Liberal donors that are doing business with the government include KPMG, which received supplier payments in the past decade of $25.6 million, Rogers Group ($16.7 million), CN ($13.3 million), Fasken Martineau ($9.7 million), Tolko ($9.7 million), Western Forest ($8.8 million), Canfor ($7.3 million), the Beedie Group ($5.1 million) and West Fraser ($4.5 million).

These groups have continued to give in 2017, revealed in recent disclosures by the B.C. Liberals. So far this year, Telus has given $6,580, KPMG $3,000, Rogers $16,300, Canfor $28,950, the Beedie Group $16,000 and West Fraser $25,000 — among $2.08 million collected so far this year by the Liberals.

The NDP have declined to disclose their political contributions for 2016, which will be released by B.C. Elections soon as a matter of routine.

For the forest companies such as Canfor and West Fraser, the B.C. Finance Ministry said, payments have been made for items such as renting their equipment to help fight wildfires and buying tree seedlings.

A more detailed breakdown must wait until after the softwood lumber trade dispute is concluded, said the Finance Ministry.

Other payments included a leased warehouse building in Coquitlam owned by the Beedie Group with a partner.

Telus and Rogers provide phone and other telecommunication services to the province, and KPMG services have included report research writing, for example, an analysis of the Site C dam project.

Postmedia asked the province to explain several other supplier payments, including $3.37 million to the Aquilinis (property developers, farm owners and owners of the Vancouver Canucks) that the Finance Ministry said was for B.C. government crop insurance for farm losses.

A $240,000 payment to energy-giant Encana was for the loan of a senior petroleum engineer to the province’s oil and gas division, and $86,000 was paid to BJW Holdings Ltd. (owned by Bruno Wall, nephew of property developer Peter Wall) for a renewal of a lease on a three-bay ambulance station in Vancouver.

The Aquilinis, Encana and the Walls are top 10 donors to the B.C. Liberals.

B.C. Finance Ministry spokesman Jamie Edwardson said it is important to keep in mind that procurement decisions are made by the public service under a rigorous process.

“They are not being directed by politicians and political oversight,” said Edwardson.

Premier Christy Clark has resisted putting B.C. political donations laws in lockstep with other provinces but, under sustained criticism, she promised this week to strike a panel, whose findings on political financing would be non-binding, after the election.

Both the NDP and the Green party have said they would ban corporate and union donations and put a cap on individual donations, although the NDP continues to raise money under the existing system.

Beedie Group president Ryan Beedie said he would not comment on whether B.C.’s political contribution rules should change — that was a government decision.

Beedie, however, said any suggestion the company is seeking influence or a specific return is false. He noted that lease renewals must be put out to bid.

Ryan BeedieArlen Redekop /
Vancouver Sun

“This whole notion, this idea that somehow influence is bought is so bizarre. In my career and time in business, I have never seen anything of the sort,” he said.

He said the company’s support of the B.C. Liberals was for the big picture, the party’s pro-business philosophy.

“We provide contributions and support to the B.C. Liberal party because we believe in a strong economy that benefits everyone in British Columbia,” said Beedie.

Telus, CN, KPMG, Canfor and West Fraser all declined to comment on the question of whether companies that do business with the B.C. government should be allowed to make political contributions.

In brief written responses, KPMG and West Fraser noted they complied with all relevant laws.

Rogers, Western Forest and Tolko did not respond to Postmedia’s request for comment, while Fasken Martineau said they did not have an official to respond this week.

Former B.C. Liberal cabinet minister George Abbott, whose posts included health and education, said it was good that political contributions were being examined, noting that fundraising was never his favourite part of politics.

He said in his 12 years in cabinet, people were constantly trying to influence him whether they donated or not, but that he did not make a decision because someone had donated or not. “That would be literally indefensible.”

Bell, as does Abbott, sees the issue over donor influence as one of perception. “It isn’t a real problem,” said Bell.

However, former NDP cabinet minister Paul Ramsey, who held the finance and health portfolios in the 1990s, said the magnitude and concentration of corporate donations is a concern.

He said he believed the level of political contributions were much smaller, and much of it took place at the local level, during his time in politics.

“Yes, you give access to everybody, that’s fine, but boy it’s getting to be quid pro quo time particularly when you are raking in $40,000, $50,000 from one guy or one firm for a private dinner. That’s scary,” said Ramsey.

“The other provinces have taken a hard look at union and corporate donations — got to rein that in. I think we ought to join the party. I think the solutions are the same.”

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